(Yicai) Dec. 2 -- Chinese battery maker Changhong New Energy Technology will start constructing its new alkaline battery plant in Chonburi province in Thailand this month.

Changhong New Energy Tech plans to begin production at the factory in Yongsan International Business District by the end of next year, the Mianyang-based company told Yicai. The first phase will include five production lines with an output of over 700 million cells a year, it added.

The annual production capacity at Changhong New Energy Tech's two production bases in China is more than 3 billion alkaline batteries.

Changhong New Energy Tech announced plans to invest CNY246 million (USD33.9 million) in building the Thai factory in March. Its local subsidiary completed registration and land transfer and was applying for beneficial ownership information and bidding to build the plant, Cheng Wei, head of the unit's relevant department, said to Yicai at the time.

Changhong New Energy Tech has rapidly developed its battery business over the past ten years, with growing orders mainly from overseas clients. Its investment in Thailand and improved manufacturing capabilities abroad can reduce the potential adverse impact of changes in international trade patterns.

According to Cheng, Changhong New Energy Tech began considering setting up overseas factories at the end of last year and visited Southeast Asia.

Around 60 to 70 percent of Changhong New Energy Tech's alkaline battery orders come from foreign US, European, and Japanese customers. Japan and Europe do not have high import tariffs on alkaline batteries imported from China, but such US tariffs were raised by 25 percent to 27.7 percent when Donald Trump was first elected president in 2016.

In anticipation of further tariffs imposed by the US this year, leading Chinese battery makers have accelerated setting up factories in Southeast Asia, with Zhejiang Hengwei Technology and Ningbo Shuanglu Holding Group constructing plants in Vietnam.

China produced more than 650 gigawatt-hours of batteries last year, or almost 80 percent of the world's total, according to data from the International Energy Agency.

Editor: Martin Kadiev